Beijing: The Chinese government has accused a detained Swedish national of operating an unlicensed rights group in China, which "fabricated and distorted" information about the country and organised others to "interfere" in sensitive cases.

Beijing confirmed earlier this month that authorities had detained Peter Dahlin, the 35-year-old co-founder of the Chinese Urgent Action Working Group, on suspicion of endangering state security. The organization worked with Chinese human rights lawyers.

Chinese police and national security authorities said in a statement they had "smashed an illegal organisation that sponsored activities jeopardising China`s national security". The statement was released via the official Xinhua news agency late on Tuesday.

Sweden`s embassy in Beijing said it continued to work "intensively" on the matter and that its diplomats had visited Dahlin on Saturday.

"He is feeling well considering the circumstances," Gabriella Augustsson, head of public diplomacy for the Swedish embassy in Beijing, said in an email.

Xinhua said Dahlin and others operated an unregistered "China emergency rights aid group" and received undeclared money from overseas to carry out "unregulated activities".

"The organisation hired and trained others to gather, fabricate and distort information about China," the report said.

"It also organised others to interfere with sensitive cases, deliberately aggravating disputes and instigating public-government confrontations to create mass incidents," it said, using the Chinese euphemism for protests.

The group operated on the mainland under the name of "China emergency rights aid group", the report said.

Two other unidentified members of the organisation said "Western anti-China forces had planted Dahlin and some other people in China to gather negative information for anti-China purposes such as smear campaigns", it said.

Michael Caster, a spokesman for the Chinese Urgent Action Working Group, denounced the accusations against Dahlin. "It`s absurd to claim Peter was engaged in malicious efforts to attack or discredit China," Caster said.

"To purport that Peter was `planted` in China by foreign forces is part of a trend by Chinese authorities of blaming `hostile foreign forces` for domestic grievances," he said.

The Xinhua report also said the group got "huge sums" of money from seven, unidentified overseas organisations.

Xinhua said Dahlin had confessed that all of the reports on China`s human rights were "compiled via online research and could not reflect reality".

"Not seeing some cases myself, I cannot guarantee they are true," the report quoted him as saying.

State television broadcast footage of a casually dressed Dahlin confessing, although it was not possible to verify if he was speaking of his own free will.

It was not possible to reach Dahlin for comment and unclear whether he has a lawyer.

Xinhua said Dahlin and Wang Quanzhang, a lawyer with Fengrui Law Firm, which is at the centre of a separate government crackdown on rights lawyers, co-founded the Joint Development Institute Limited in Hong Kong in August, 2009.

Wang was formally arrested this month on a charge of subverting state power, according to New York-based rights group Human Rights Watch.